deRham v. Diamond, 32 N.Y.2d 34 (1973)

Section 21(b) of the Federal Water Pollution Control Act authorizes states to certify whether a proposed project provides reasonable assurance that it will not violate applicable water quality standards, but does not empower states to reconsider issues within the exclusive jurisdiction of the Federal Power Commission.

Summary

This case concerns the scope of New York State’s authority to issue a water quality certification for Consolidated Edison’s (Con Ed) proposed Cornwall pumped storage hydroelectric project under Section 21(b) of the Federal Water Pollution Control Act. The New York Court of Appeals held that the State Commissioner of Environmental Conservation’s certification was valid, emphasizing that the state’s review was limited to water quality standards and did not extend to issues already within the Federal Power Commission’s (FPC) jurisdiction. The court found that the Commissioner acted reasonably in determining that the project would not violate applicable water quality standards.

Facts

Con Ed applied to the FPC for a license to construct a pumped storage hydroelectric facility on the Hudson River at Storm King Mountain. After initial approval and subsequent remand by the Second Circuit, the FPC again granted a license. As required by Section 21(b) of the Federal Water Pollution Control Act, Con Ed applied to the New York State Department of Environmental Conservation for a certificate of reasonable assurance that the project would not violate state water quality standards. The Commissioner issued the certification with certain conditions designed to ensure future compliance with water quality standards.

Procedural History

Conservation groups and others opposed to the project initiated an Article 78 proceeding in New York State court to review the Commissioner’s determination. The Special Term annulled the certification, but the Appellate Division reversed and dismissed the petition. The petitioners then appealed to the New York Court of Appeals.

Issue(s)

Whether the State Commissioner of Environmental Conservation acted arbitrarily and capriciously in certifying that there is reasonable assurance that the Cornwall Project would not violate applicable water quality standards, and whether the Commissioner failed to consider relevant matters in making his determination, including the safety of the Catskill Aqueduct and the protection of the River’s fish life.

Holding

No, because the State Commissioner’s authority under Section 21(b) of the Federal Water Pollution Control Act is limited to determining whether there is reasonable assurance that the project will not violate applicable water quality standards. It does not extend to reconsidering issues within the Federal Power Commission’s exclusive jurisdiction, such as the safety of the Catskill Aqueduct or impacts on fish life beyond effects on water quality standards.

Court’s Reasoning

The court emphasized that Congress vested the FPC with broad authority over hydroelectric facilities affecting navigable waters, preempting most state licensing functions. Section 21(b) relinquishes only the narrow question of whether the project will violate state water quality standards. The Commissioner was only required to consider the regulations governing “Class B” waters, the classification of the Hudson River at Cornwall. The court found that the Commissioner gave due consideration to factors affecting water quality standards and that his determination was rational and reasonable. The court also rejected the argument that the Commissioner failed to adequately consider the effects on fish life, salt water intrusion, and thermal pollution, noting that the record contained ample evidence supporting the Commissioner’s findings. The court stated that the conditions attached to the certificate related to future compliance and were authorized by both state and federal law. Regarding the Catskill Aqueduct, the court held that the issue had already been litigated in federal court and that, in any event, the project would not discharge into the Aqueduct, and there was no suggestion that the project would pollute its contents. The court quoted the Appellate Division: “In regard to New York City’s contention that the implementation of the project may cause physical damage to ‘ The Catskill Aqueduct ’, such a consideration has no bearing on water quality and if such damage does result, it is a matter of concern between the licensee and the city and the certificate issued by the appellant Commissioner is obviously not a permission by the State, to cause physical injury to another’s property.”